GOVERNMENT;What Budget Squeeze? There's Money to Borrow

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The state government is facing lean times, and the Legislature, the Whitman administration and dozens of interest groups are furiously debating what expenses to cut to bring the $16 billion budget into balance. But lawmakers are still feeling generous when it comes to borrowing money to pay for future programs.

So far, nine bond issues have been proposed for the November ballot, for a total of $1.6 billion in new spending -- nearly half as much as the state's entire existing bonded debt.

This does not mean that all nine will actually be on the ballot. Each year, lawmakers propose as many as 15 bond issues, of which only a handful (and often none) are approved by the full Legislature and the Governor for submission to the voters. Still, all are awaiting hearings in various legislative committees; approval requires a three-fifths vote in both houses, or a simple majority two years in a row. The deadline for inclusion on this November's ballot is Aug. 27.

Voters have traditionally looked kindly on environmental bond issues, and the largest proposal so far would allow the state to borrow $450 million for the Environmental Cleanup and Containment Bond Act of 1996. The money would be used to match Federal funds to dredge the Kill Van Kull, to build containment areas for dredged material, to upgrade underground storage tanks and to safeguard drinking water supplies.

No one testified against the bond act at a hearing of the Assembly's Environment, Science and Technology Committee last week, while the State Department of Environmental Protection, the Port Authority of New York and New Jersey, and business and labor groups all said the money was needed to keep ships moving in the port.

HOUSING $290 million to build affordable houses and apartments, to help low-income families make down payments and pay closing costs for home purchases, and to provide loans and grants for small businesses. Two bills are proposed, with one in the Assembly Housing Committee and one in the Senate Urban Policy Committee.

PRISONS $275 million to pay for building and renovating state prisons and county jails. As an alternative, voters would be asked for $150 million to build new jail space, with at least $40 million to be used for county adult jails and juvenile detention centers. Both proposals are in the Assembly Law and Public Safety Committee.

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PINELANDS PROTECTION $70 million, mostly for grants and loans to local governments in the Pine Barrens for sewage treatment and water supply projects. The bill is in the Assembly Environment, Science and Technology Committee.

DEMOLITION $35 million, most of it to be used for loans and grants for local governments to demolish unsafe buildings. Two bills are proposed, with one in the Assembly Local Government Committee and one in the Senate Urban Policy Committee.

SCHOOLS $250 million for construction and renovation of schools, with $60 million to be set aside for grants to build kindergarten and pre-kindergarten classrooms in poorer districts. The bill is in the Assembly Education Committee.

LIBRARIES $50 million to build and renovate libraries, with grants of up to 20 percent of any one project's costs. The bill is in the Assembly Education Committee.

MENTAL HOSPITALS Trying to stave off the Whitman administration's plan to close Marlboro Psychiatric Hospital, supporters have proposed this $50 million bond issue to improve the hospital or build a new one on its grounds. The bill is in the Assembly Health Committee, but even its supporters concede that its prospects are dim.

A version of this article appears in print on April 28, 1996, on Page NJ13 of the National edition with the headline: GOVERNMENT;What Budget Squeeze? There's Money to Borrow. Order Reprints|Today's Paper|Subscribe